Yesterday it was announced that Ron Johnson was dismissed as the CEO of JC Penney. He came into the company 17 months ago with great fanfare. Johnson was the genius behind the Apple Store and was going to change department store retailing as we know it. Opps.
Johnson’s main principle was that he was going to do away with heavy promotion and focus on everyday value. The lesson here should not be that the strategy was flawed. It should be that fundamental change like this is virtually impossible in a relatively healthy company. There is no compelling reason to take the risk. Employees don’t feel the change in their guts and customers aren’t behind the change. If this change is to happen it will come from a new entry into the market place. Only with a new entry will customers be taking control and making a positive choice to spend money there.
Creative Destructionism at it’s finest.